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Despite heavy FPI selling, indices are still only about 5 per cent below record highs.
Illustration: Dominic Xavier/Rediff
Key Points
- Market breadth remained weak, with 2,989 stocks declining and 1,229 advancing
- The spot gold hit a new high of $4,976.59 per ounce.
- FPIs have sold shares worth Rs 33,958 crore so far in January
Indian equities declined on Friday, with the benchmark Nifty posting its worst weekly fall since September, as foreign investor sentiment remained weak amid tepid earnings growth and little progress on the India-US trade front.
The Sensex ended the session at 81,538, down 770 points, or 0.9 per cent, while the Nifty 50 index closed at 25,049, declining 241 points, or 1 per cent.
Over the week, the Sensex fell 2.4 per cent.
The Nifty, on the other hand, slipped 2.5 per cent, marking its sharpest weekly decline since the last week of September 2025.
The total market capitalisation (mcap) of BSE-listed companies fell by nearly Rs 7 trillion on Friday to Rs 452 trillion. For the week, it declined by Rs 16 trillion.
Gold and silver
Meanwhile, the spot silver price surged 4.2 per cent in the international market to $100.29 an ounce, bringing gains this year to almost 40 per cent after prices more than doubled in 2025.
The spot gold hit a new high of $4,976.59 per ounce.
The equity markets remained volatile through the week amid tensions between the US and Europe over Denmark.
However, US President Donald Trump’s decision to scale back his threat of imposing tariffs on countries opposing his bid for Greenland, and his remarks ruling out the use of force, provided some relief.
“There is still scepticism about how the Greenland issue will play out despite Trump’s statements,” said U R Bhat, co-founder of Alphaniti Fintech.
Investors have also remained cautious ahead of the Union Budget, amid expectations of limited policy support.
Early earnings announcements for the third quarter of FY26 have reinforced concerns over profitability, with the combined net profit of early-reporting companies rising just 3.5 per cent year-on-year (Y-o-Y).
FPIs
Foreign portfolio investors (FPIs) remained net sellers, with no breakthrough reported in India-US trade talks.
FPIs have sold shares worth Rs 33,958 crore so far in January, the highest monthly outflow since August 2025.
On Friday alone, FPIs sold Rs 4,113 crore worth of equities, while domestic institutional investors bought shares worth Rs 4,103 crore.
Rupee
The rupee fell to a fresh low of 91.96 against the dollar.
“Most market participants do not believe a trade agreement is imminent.
“Despite heavy FPI selling, indices are still only about 5 per cent below record highs.
“With headwinds such as rupee depreciation, geopolitical tensions and weak earnings, market risks remain elevated and could warrant a deeper correction,” Bhat said.
Shares of Adani group companies declined after a US market regulator approached a district court to formally notify group founder Gautam Adani and his nephew, Sagar Adani, of a lawsuit alleging violations of US securities laws and a bribery scheme linked to solar power contracts.
InterGlobe Aviation shares fell 4.3 per cent after the airline reported a 77.6 per cent Y-o-Y decline in third-quarter net profit to Rs 549 crore.
The results were announced after market hours on Thursday.
Market breadth remained weak, with 2,989 stocks declining and 1,229 advancing. Eternal was the biggest drag on the Sensex, falling 6.3 per cent, followed by Reliance Industries, which slipped 1.1 per cent.
“With the Q3 earnings season still underway, stock-specific movements are likely to remain prominent, while overall sentiment is expected to stay cautious,” said Vinod Nair, head of research at Geojit Investments.
